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Calculate the budgeted profit of the hand bag division for the month and prepare a statement for that division for April 2015 showing the variances for the month and reconciling the budgeted profit with the actual profit.

Exclusive Bags Ltd manufactures high quality handbags in one of its divisions. The standard cost schedule applicable for April 2015 is set out below. Standard cost and selling price per hand bag (assuming monthly production of 640 items) Leather Set of Zips & Buckles Labour (variable) Variable overheads* Fixed overheads* Total standard cost Margin Selling price 0.5 square metres at 15.00 30 per square metre 2.50 per set 2.50 2 hours at 15 per hour 30.00 2 hours at 2 per hour 4.00 2 hours at 6 per hour 12.00 63.50 26.50 90.00 * Overheads are allocated on the basis of standard labour hours The actual figures for April 2015 are set out below. There were no changes in stock levels. 61,203 12,200 1,735 Sales: 690 Handbags Less expenses: Leather: 408 squares meters Buckles etc: 694 sets Labour: 1350 hours Variable overheads Fixed overheads Manufacturing Profit 22,275 2,600 9.400 48,210 12,993